Helping Canadians in Housing Need
Stable, affordable housing is a foundation for healthy living and a building block for success in other areas — education, the labour market and community engagement. Working with other federal partners, provincial and territorial governments, non-profit and co-operative housing groups and the private sector, CMHC provides assistance to low-income households, seniors, people with disabilities, people at risk of homelessness and Aboriginal people by improving access to affordable housing.
Federal Investments in Affordable Housing
On behalf of the Government of Canada, CMHC invests approximately $2 billion annually to help reduce the number of Canadians in housing need. This includes significant funding for social housing. Ongoing subsidies are provided under 25 to 50 year operating agreements with housing groups who provide affordable housing to those in need. When these agreements mature, federal government funding will end as planned.
The majority of non-profit and cooperative housing projects are expected to be financially viable and mortgage-free at the end of the operating agreements. Housing providers will find themselves with valuable real estate assets and a decrease in operating expenses that can be used to continue to offer affordable housing.
Approximately 80 per cent of the existing social housing portfolio is administered by provinces and territories under long-term agreements with CMHC. The remaining 20 per cent is administered by CMHC and includes the on-reserve portfolio and certain federally funded housing units off-reserve, such as housing cooperatives.
Also as part of the $2 billion annual investment, CMHC provides funding to provinces and territories under the Investment in Affordable Housing (IAH).
The federal government, through CMHC, invests approximately $2 billion annually under various programs and initiatives to help Canadians in need access affordable, sound and suitable housing.
Under the IAH, the provinces and territories cost-match the federal investment and have the flexibility to design and deliver affordable housing programs that address their local housing needs and priorities. Initiatives can include: new construction, renovation, homeownership assistance, rent supplements, shelter allowances and accommodations for victims of family violence. Depending on their priorities, provinces and territories can use IAH funding for social housing projects whose agreements have matured.
For those households whose needs cannot be met by the marketplace, governments, community organizations, non-profit and cooperative groups and the private sector are working together to provide affordable housing solutions.
CMHC also supports affordable housing through our Direct Lending Program, which provides low-cost loans to federally assisted social housing sponsors seeking to finance new projects on-reserve or to renew existing financing. As a federal Crown corporation, CMHC can obtain funds under the Crown Borrowing Framework at a lower cost than a private lender. These savings are passed on to social housing sponsors in the form of lower interest rates on mortgage loans.
CMHC Affordable Housing Centre
A key CMHC strength in the area of affordable housing is our ability to understand local needs and challenges and to work collaboratively with community stakeholders on the solutions. CMHC’s Affordable Housing Centre works with the private, public and non-profit sectors to help develop affordable housing that does not require ongoing federal assistance.
Through the Affordable Housing Centre, CMHC offers knowledge, expertise and financial assistance to help affordable housing projects get off the ground. Examples of financial support include: Seed Funding, which can cover some of the initial costs involved in developing a housing project proposal (e.g. market studies to evaluate need and demand or development of a business plan).
CMHC also offers a suite of information tools, such as interactive capital replacement tools, workbooks and distance learning opportunities through web forums, to help housing providers manage and preserve their housing portfolio.
To support the creation of affordable multi-unit housing, CMHC offers financing flexibilities for mortgage loan insurance, including loan-to-value ratios of up to 95 per cent and reduced premiums. The higher the level of affordability, the greater the flexibilities offered. In addition, homebuyers of an eligible affordable housing project may benefit from mortgage loan insurance flexibilities such as the recognition of a broader range of down payment sources and borrower qualification requirements.
“With CMHC’s Seed Funding, we could study the site, make plans and estimate these plans to see if the project would be viable or not.”
Patrick Thériault, President, Habitation Canadienne
Val Bélair QC
For More Information
For more information about CMHC and how it makes a difference in the lives of Canadians, call 1-800-668-2642.